Decibel Presents: Rundberg's Empty Buildings

If you live in the Rundberg neighborhood, chances are you have driven by a few vacant buildings, including a defunct Sonic Drive-In on North Lamar Boulevard, or the large slab of concrete at the former site of Action Pawn on 801 E. Rundberg Lane.

Collectively, the properties have collectively sat vacant for at least a year now. Austin ranks as the second-fastest-growing city in the country. The city's population has boomed over the past decade, and property developers continue to pour money into the region. Yet the same growth that transformed downtown Austin into a corridor of glittering skyscrapers has largely bypassed these corners of Rundberg. So what's going on here?

According to Austin-based commercial realtor Joaquin Lopez, the answer lies in the broader dynamics of the local real estate market.

“It slowed and idled since 2022,” Lopez says. “Since the downturn in the economy, the Austin market has took a hit in the multifamily and now actually the industrial space because of saturation. …it's not just vacant buildings that are the problem because they're just sitting there doing nothing.”

It is important to understand the difference between vacant and abandoned properties. A vacant property is simply unoccupied, but it is still owned and managed by someone. An abandoned property, however, is typically neglected, may have unpaid taxes or code issues, and is often left behind by an owner.

There is no legal process for abandoning a property. Residents can report neglected buildings to the city, which has, in some cases, eventually resulted in the demolition of the unsafe structure. Residents can report code violations and suspected abandoned properties through the Austin 3-1-1 app. But that process can take a long time for the city to properly investigate and enforce any code violations.

These properties in Rundberg, however, are not abandoned. The Jack in the Box and Sonic locations remain owned by their respective regional franchise operators, while the concrete slab is owned by HUGGINS-MICHALK LTD.

While the companies did not respond to requests for comment on why the properties remain vacant, Lopez says there are a number of reasons they may have ended up in their current state.

“They were operating a business out of it, and there wasn't the right demographic or the right opportunity,” Lopez says. “But at the end of the day, there's value in that real estate. … It's something very manageable to just work through and wait for the right time and the right opportunity.”

That strategy of holding onto vacant or underutilized property as an investment is what fellow Austin-area realtor Megan Flake describes as "land banking."

“If they're looking at the cost of labor or raw materials, and they're realizing that the development is going to be more expensive than they had originally projected, it could be worth their while to hold on to the property,” Flake says.

But that still leaves another question: even if owners decide to sell, who would actually buy these properties?

According to Lopez, a lot of developers, especially in commercial retail, aren't looking for vacant buildings that require major renovations. And fast food restaurants are particularly challenging to transform. Unlike a small retail storefront, they're designed for a very specific purpose, making them far more difficult to repurpose.

Simon Keith is a building enclosure consultant for Salas O'Brien and teaches architecture at the University of Texas at Austin. He says the more specialized a building is, the harder it becomes to give it a second life.

“Unfortunately, fast food restaurants, they're like highly bespoke,” Keith says.

Keith says architects should design with flexibility in mind. He advocates for adaptive reuse, a design philosophy that encourages buildings to evolve as communities' needs change.

“Every time you tear down a building and build a brand new building… an incredible amount of embodied carbon is wasted,” Keith says. “Something like 40% of global warming emissions in the world is because of buildings.”

For an example of what adaptive reuse can accomplish, look no further than ACC Highland Campus.

According to Aziz Hussaini, Associate Vice Chancellor of Campus Planning for ACC, the current campus is the result of years of planning and millions of dollars in investment to transform the former Highland Mall into something entirely new, in an area that could serve a large student population.

“When we hit the 2000s, it started becoming a bit of an abandoned mall,” Hussaini says. “ACC was transitioning and growing … so we needed to start identifying existing structures that were in place already that could serve that need.”

What followed was a multi-year, multimillion-dollar effort to transform the mall. 15 years later Hussaini says the investment has not only revived the mall, but the surrounding community. New apartments, parks and restaurants have been added to the area since ACC began transforming Highland Mall.

However, Highland Campus' success does not change the reality facing the vacant properties in Rundberg. Keith says preventing more properties from becoming vacant starts with designing them differently from the beginning, but it can be hard to convince developers to try something different.

“The market drives a lot of things,” Keith says. “A developer who's going to build something and flip it for profit within a couple of years, it's a tough sell, because even if you say, ‘look, this decision…it's actually saving you money,’ they don't care. They're off and running.”

Ultimately, much of that responsibility, Lopez says, falls on property owners and developers. Outside of future policy changes, he says the biggest factor may simply be time.

“The reality is it's just going to require a little patience because there's very similar cycles that neighborhoods go through that have spanned since the beginning of time,” Lopez says. “It's starting to grow and be built up. It gets stabilized, then it becomes a blighted market. …And that's just the ebb and flow of how neighborhoods work.”